Errors over these limits

details of cumulative under or over-declarations, where these have happened

Credit notes

If you’re a supplier and you make an error and overcharge a customer, you’ll need to issue a credit note to them. Account for the credit note in the accounting period you correct it in your business accounts.

If the error and the correction are made in the same accounting period, treat it as a current period adjustment. If it’s corrected later deal with it as an error on your return.

You should follow the instructions under the heading ‘Errors over these limits’ if your business is insolvent.

Tax credits

When you accidentally overpay CCL you can claim tax credit.

This usually happens when:

you charged the main rate of CCL on a supply and should have charged the reduced rate or nothing

you declared it in a previous return and then again by mistake

your customer isn’t entitled to claim a tax credit to adjust the CCL relief claimed on their relief certificate

The tax credit is an over-declaration of CCL. You should account for it on your return if the total cumulative over-declarations are within £50,000 (£10,000 for no-VAT registered companies). If the over-declaration total is over this amount you need to follow the instructions under the heading ‘Errors over these limits’.

Records you must keep

You must keep records that prove the amounts of CCL you declare are correct. You can use any of these formats:

paper

paper records copied to microfiche or microfilm

computer records, including removable storage such as CDs and memory sticks

You need to keep records for 6 years and make all records available to HMRC if it asks to see them. You must be able to convert computer records to paper if needed.

Climate Change Levy account

You must keep a Climate Change Levy account if you’re registered for CCL. For each accounting period you must summarise the total CCL due to support your return. It should include itemised transactions to show the accumulation of CCL.

Other accounts you need to keep

The other accounts you should keep depend on your business. The most common accounts are: